My 12 Rules of Fundraising

There is plenty of nuance in what stage you are in, whether your company is direct to consumer or SaaS, whether this is your first time etc. etc. I know, I know.

Notwithstanding, here are some universal basics which, I believe, covers plenty of common sense ground:

1) be clear why you are doing this — why you have this need so much in your teeth you can’t do anything other than this.

2) be clear why you are the one TO do this — and will have persistence but also the humility to listen, learn and pivot if necessary.

3) keep your pitch deck short and concise. (little secret, in a first meeting I barely even refer to it). 

4) your projections are bull shit, but can show you understand the drivers of your business. know your cost of acquisition and the how of it.

5) know your use of proceeds — why are you raising what you are and where do you think it will take you.

6) understand what would happen if you raised half of what you want or three times as much (ie would you stall on the former, grow 10x faster on the latter).

7) never, ever, be intimidated by money. investors seem rich and smart — and the best have great pattern recognition and have helped entrepreneurs. but most have never actually done what you are about to do, and none know more about your business than you do (or if they do, you should do something else...)

8) know if you are looking for quiet (read “dumb”) money or if you are looking for some expertise/relationships that can help you concretely. emphasis on “concretely.”

9) think about what can happen to you and the company in future capital needs (your investors are often thinking about little other than this).

10) create a sense of urgency in your raise — find a good anchor as fast as you can, push for a fixed close, get more than one term sheet. easy right?

11) reference check the hell out of an investor if they are looking to be a board member or adviser. integrity and temperament is important, but what they will actually do or not do as crucial. speak especially to entrepreneurs they have previously invested in (and try to find any that haven’t used them again).

12) be the investment you seek. surprise no one, be honest, determined, direct, show what you don’t know and how you will know it. be genuine.

And have fun. You will learn a ton in this painful process — about yourself and your company. You will receive mostly “nos” but don’t take it personally. It is not personal. It is the journey.

Ps. I have more rules once you GET term sheets — but for another post....